Risks of investing

The recent economic downturn has left many people in deep trouble. Such as retirees who invested in products that have since gone bust.

But to me, the real problem could well be the banks and their relations managers. Every bank wants to sell its investment products, but relations managers must not prey on the old. People are greedy by nature, but preying on greed and ignorance is downright wrong. Yes, there are risks to investments, and I am sure that the relations managers did highlight the existence of risks. But are the relations managers trying to help their customers, or trying to help themselves?

A responsible relations manager looks long term, and introduces investment products suitable for the person's taste of risk and current financial status. After all, I am sure banks would rather have returning customers, instead of having people call them asking for their money back. If all relations managers are responsible, we won't have retirees asking for their money back, since they will have understood the risks involved, and are probably able to take that risk.

So maybe this is a chance for people to relook into how they should be investing. It is a lesson with a high price, but maybe it will teach banks that they need to train their relations managers to be responsible, to introduce the right products to the right person, and not just look at churning out the dollars.